December 23 2013
Pelosi Picks Health Exchange, Reid Does Not
Democratic leader's decision to move her staff onto Obamacare is commendable
House Democratic Leader Nancy Pelosi deserves credit for her recent decision to move her staff onto the Obamacare health insurance exchanges. The former Speaker of the House is being consistent: She's sending the message that if Obamacare is good enough for the American people, it's good enough for her staff.
But Pelosi's actions sharply contrast with those of Senate Majority Leader Harry Reid, who is taking advantage of a special exemption and keeping some of his staff on the cushy Federal Employee Health Benefit Program (FEHBP). Leader Reid is hypocritically shielding staff from the effects of a law he helped to create.
In the summer of 2013, Senate Democrats met with President Obama to address an amendment in the Affordable Care Act (Obamacare) that required members of Congress and their staffs to access health insurance through the law's exchanges. The outcome of these backdoor meetings was a ruling from the Office of Personnel Management that gave members a choice: Keep your staff on the FEHBP or move them into the exchanges (with a generous,one-of-a-kind subsidy).
In either case, Congress is getting special treatment. And Americans, regardless of their political predilections, recoil from this kind of favoritism. When Independent Women's Voice conducted polling on this issue, 92% of respondents answered that this was unfair.
But there is more than fairness at stake. The purpose behind the original amendment, according to its author Sen. Chuck Grassley, was "so that we [Congress} would have to go through the same red tape as every other citizen."
Indeed, many private-sector employers have to make a decision for their staffs: Do I continue to offer health benefits to my workers or usher them into the exchanges?
Unlike Congress, private-sector companies have to consider their bottom line. While businesses often use benefits to compete for good workers, health insurance costs have continued to increase and to consume larger and larger percentages of overall compensation. That's why health costs top the list of employers' concerns.
In 2015, businesses of 50 or more workers will face penalties if they do not offer adequate health coverage. But the penalties – $2,000 or $3,000 per worker per year – are far more affordable than the plans themselves. Businesses with fewer than 50 workers face no penalty for forgoing health benefits.
To their credit, many employers also see health coverage as a moral obligation, part of their commitment to care for workers and their families. These employers have to ask themselves how their workers will fare in the new exchange plans, which offerlower reimbursements for doctors and limited networks for patients.
A survey of federal employees suggests that they understand the inferiority of the Obamacare exchange plans. Fully 92% of federal workers and retirees prefer their current plan to enrolling in Obamacare. Furthermore, the National Treasury Employees' Union representing IRS workers lobbied hard against legislation that would have moved them into the Obamacare exchanges.
Pelosi may have considered all of this when choosing to put her staff in the exchanges, but consistency (or a fear of further criticism) won out.
Reid, on the other hand, is acting unfairly and unwisely. As a boss, perhaps he is trying to do what's best for his staff. But as a national leader, he should think hard about shielding his staff from a law that exposes other employers to higher costs and hard decisions. As one of the law's greatest advocates, he should be the first in line to enroll himself and his staff in Obamacare. But he isn't.
Hadley Heath is director of health policy at Independent Women's Forum.